Sky News – AM Agenda

E&OE

Kieran Gilbert:

This is AM Agenda, with me now Liberal frontbencher Senator Zed Seselja. It’s the end of the year but obviously lots happening in terms of the economic front, we’ve got the budget update early next week, today the jobs numbers, and all of this at a time when consumer confidence is at a six month low off the back of those GDP numbers. What do you make of where we sit right now at the end of 2016 on the economic front?

Minister Seselja:

Well obviously consumer confidence goes up and down Kieran but what’s important for it is that we keep rolling out our economic plan because that’s what’s going to build confidence over time. If we look at our economic fundamentals, when we compare ourselves to the rest of the world, we compare pretty well. Now that doesn’t mean that there aren’t significant challenges in our economy. In some of these global challenges we need to constantly respond, we need to be getting the budget under control, we’ve done $20 billion of budget savings just in the last few months, we need to have economic reforms so one topical one at the moment obviously is Badgerys Creek going in, very important for the Western Sydney economy but more broadly lowering taxes and costs for companies so they can employ more people. These are the kind of policies, and if you look at things like the ABCC which has passed, this is about making construction more possible and more effective and cheaper in this country. That’s an important economic reform. So those economic reforms need to continue, that’s the best way to continue to build consumer confidence. But of course those numbers will go up and down.

Kieran Gilbert:

You mention the Badgerys Creek development but the front page of the Australian today suggesting that there are questions as to who is going to pay for the $5 billion project.

Minister Seselja:

Well look obviously the detail of that is a matter for Paul Fletcher but this is a really important development for Western Sydney. Western Sydney is a huge economy, it’s a huge part of the Australian economy and for it not to have its own airport I think has been a failing. We’ve taken the decision, it’s unfortunate we’re getting I think some resistance from Labor members, I think a little bit of short term politicking which actually undermines…

Kieran Gilbert:

[Interrupting] Not from all, there’s only a handful…

Minister Seselja:

[Interrupting] Well there’s a number in the region and the real question then becomes what is Labor’s policy on Badgerys Creek? I mean this is really important for Western Sydney, it’s important for the broader national economy. It’s an important piece of infrastructure so we’re getting on with that. Those are important changes; those are important pieces of progress that will continue to build our economy. When we look at some of those threats to the economy, of course Labor’s plans for higher spending, higher deficits, and of course opposing really important things like lower taxes whilst wanting to increase taxes of their own, they are some of the threats and I guess…

Kieran Gilbert:

[Interrupting] But to be fair to Labor they have cooperated in terms of the omnibus savings bill, the superannuation package and so on has got through this year as well. When it comes to Labor, they’re suggesting that your company tax cuts should be rethought or at least reined in and then you’d avoid any threat to the triple A credit rating.

Minister Seselja:

Well if they want us to be completely uncompetitive, when we see the UK lowing company tax, when we see the US planning to lower company tax. If they want us to not compete on a global scale, if that’s Labor’s economic plan, well that’s one we reject. If you want people to do less of something, tax it more and Labor wants to tax investment with their capital gains tax increases, they want to also tax companies more. We want to see company tax come down because we know that’s critical to growing…

Kieran Gilbert:

[Interrupting] But it’s very very expensive and Labor points out that it’s a multi-billion tax cut for the big banks for example at a time when the triple A rating is at threat. That’s the point.

Minister Seselja:

That’s a very cute line from the Labor Party but they are actually opposing tax cuts for businesses that have a turnover of 2.1 million dollars. I mean 2.1 million dollars; you know we’ve got cafes and other businesses that have turnovers in that vicinity and Labor are saying that they shouldn’t get a tax cut, that they shouldn’t get tax relief. So it’s a very cute line but they are opposing tax cuts for small business. I think a business with a turnover of $2 million, $3 million, $4 million, is not a large business but it is important to our overall economy. So we think that that’s actually critical that those sorts of things go forward, now I think there’s a real growing divide between the Coalition and Labor on key areas of policy. I mean one of the big things that Bill Shorten is going to have to answer next year will be why he wants to slug everyone higher electricity prices with his 50% renewable energy target. These kinds of policies have a real impact on the economy, not just on consumers but of course on business and their ability to locate in Australia and employ…

Kieran Gilbert:

[interrupting] we’ll explore that a bit more in a moment but just in terms of the company tax cuts would you see that as a benefit in disguise to an extent if you get some of it through but not all of it? Therefore you get the longer term savings and the trajectory on spending isn’t as tough but you get the tax cuts for say businesses up to $10 million turnover per annum which you might be able to get the likes of Xenophon across the line with.

Minister Seselja:

Well we’d like to get our entire economy plan through Kieran, that’s very much the plan but this idea, I mean this is this magic pudding idea the Labor Party puts forward that a tax cut in fact a hand out, that’s how they describe it. Well it’s actually allowing companies and individuals to hold on to more of their own money so that they can then invest. You don’t have a sustainable budget in the long run if you don’t have companies growing and employing people, any economist will tell you that and in fact that Labor Party including Julia Gillard including Bill Shorten are all on the record saying that lower company taxes leads to more jobs and higher wages. Now if you want higher wages which I do, if you want more jobs which I do and the Coalition does, lowering company tax is a critical way to do that.

Kieran Gilbert:

Tony Abbott yesterday said on radio that he wants Australia to be the affordable energy superpower of the world. Is that a realistic proposition into the future? Don’t we have to be realistic in the sense that there has to be some sort of price paid if we’re going to meet those targets that Mr Abbott agreed to as part of the Paris Agreement?

Minister Seselja:

Look it’s certainly not possible if you have a 50 percent renewable energy target Kieran. That’s the Labor policy, that’s the alternative and that’s why Josh Frydenberg has been arguing with the states about some of their completely unrealistic energy targets, renewable energy targets. We want first and foremost, we think that you need to keep the lights on; secondly you have to make sure that power is affordable so it has to be accessible…

Kieran Gilbert:

[Interrupting] Does the government, do you have a plan though to do those things? Because at the moment Direct Actions seems to have a use by date, beyond that this review’s been restricted, the parameters have been set, and that includes no emissions intensity scheme for power for example.

Minister Seselja:

Well we certainly don’t support a Carbon Tax or a Carbon Tax by another name, which is effectively an ETS and other schemes. So no we don’t and as I say Kieran that is one of the emerging clear points of difference between this Government who is focused on keeping energy prices as low as possible and the Labor Party with their reckless 50% renewable energy target which we know will push prices up. I mean is Bill Shorten really going to argue to consumers, is he going to argue to people in regional areas who are already potentially doing it tough that not only should they lose their jobs if they work at places like Hazelwood, under Labor’s policies they should also be paying more for electricity?

Kieran Gilbert:

Minister, thanks so much for your time today, our last chat before Christmas, all the best to you and your Family.

Minister Seselja:

Thanks very much Kieran, Merry Christmas.